The modern workplace is at it again. Every day there’s a story about another company throwing conventional office rules out the window — no dress code, work from home, bring your dog, cat, parakeet, or python to the office — and blazing the trail toward a new way of thinking. This time, the traditional hierarchy of a company is in question.

No managers. No team leaders. No bosses.

If you’re a small business owner, this concept isn’t that unusual. In fact, most small business owners open their own place for just this reason. But can it work on a larger scale with 50 or more employees outside of Sir Thomas Malory’s Camelot or Alexandre Dumas’ 17th century France? Can a group of people govern themselves in an office environment with a “Round Table,” or “all for one, one for all,” mantra?

If you ask gaming company Valve or software company Menlo Innovations, the answer is yes.

NPR ran a story earlier this week about Menlo, the company located in downtown Ann Arbor, Mich. that has taken the concept of a “flat or bossless office,” to a whole new level.

The company has two co-founders and a CEO, but they don’t hold the power. Instead, the entire team is in charge of all major decisions.

There are no walls, cubicles or offices either. The employees sit at long tables with each other (CEO included), work two to a computer while programming so they have instant feedback and are also encouraged to communicate face-to-face instead of through email.

Then there is Valve Corp. located in Bellevue, Wash. They also don’t have managers, but they up the ante by not even having assigned projects. Instead, they work on projects the group believes are worthwhile.

Salary? Determined by peers who rank each others performance. Promotions? None. Only new projects.

Both companies are having success with these business models, but it may not necessarily work for every environment. So let’s look at both sides of this work style.

When it Works

One easy criticism of this format is it has too little structure to actually work in the long run. That it would instead function more like a classroom of children with a substitute teacher than a productive work environment. But companies like Valve and Menlo see advantages with it.

One advantage is increased productivity. By “flattening” the management hierarchy and eliminating middle management, the company can act more efficiently because it does away with unnecessary chain of command. If everyone at a company is equal, the idea is heard right away and implemented if the team believes it’s the best solution.

Menlo CEO and Co-Founder Rich Sheridan told NPR that the company functions much like a baseball team.

“If you look at a baseball team in the field, no one would say, hey who does the pitcher report to, who does the catcher report to? People who really understand baseball would say, well, they have a role to play but their real purpose is to win the game.”

There is also an overall culture and sense of togetherness when people are forced to work two to a computer and all ideas matter, are heard, and the best is implemented — whether it came from the CEO or someone who has been at the company for two weeks.

Recent research from the University of Iowa and Texas A&M University focused on this concept and had mixed results. On one end, the study showed factory worker teams who supervised themselves outperformed workers with a traditional team or projects leader when the team members liked and worked well with each other.

On the other hand, additional research shows that structure and hierarchy in an organization gives workers a purpose and role that increases efficiency.

The Downside

As you can imagine, this work environment is not for every organization. In fact, Valve mentions in their own employee handbook one potential downside of the bossless office — bad hiring decisions going unnoticed for a long period of time.

Because there is no team of managers or boss to review employees, unproductive workers can fly under the radar for months or even years before taken care of.

Former programmer at Valve Corp., Jeri Ellsworth told the Grey Area podcast and Wired magazine, “what I learned from Valve is that I don’t think it works. I think if you give complete latitudes with no checks and balances, it’s just human nature [employees] are gonna try to minimize the work they have to do and maximize the control they have.”

These flat organizations also only work with the right people. People who aren’t seeking conventional office accolades or fulfillment like moving up the corporate ladder with promotions. The reward in these organizations isn’t a new title, but the chance to work on challenging and creative projects.

Sixteen-year veteran of Valve Corp., Greg Coomer told The Wall Street Journal in order to work, these companies have to hire highly-motivated people and that it takes anywhere from six months to a year to adapt to the flat or bossless environment.

Still, companies around the country are breaking down these conventional office hierarchies and finding success. And in a field and market as volatile, competitive and ever-changing as the tech industry, companies are constantly looking for new ways to attract talented and innovative employees to sit at their own Round Table.

Simon Laing 3 years ago

How does a company fire a worker that consistently misses KPI targets with no boss or and coworkers that are close friends. In China there are many examples of State owned companies with legacy hires that are not productive but can not be fired. It is very hierarchical but there are not the checks and balances that there is in other companies. There is more to employee motivation and worker productivity than having a boss or not.

asok 3 years ago

ChennaiBala 3 years ago

johnaudie 3 years ago

Simple Solution to hiring. The Project decides on who to hire and then vets the new guy and see if he will fit into the team and in a couple of months do an evaluation discussion on whether the new guy jells with the team.

Dee Baig 3 years ago

Agree with Jeri! This is not a long-term view. The concept of a Boseless office is beneficial only when a set of right people get together to work but still there is possibility that after a short span of time their tendencies, enthusiasm and sincerity may waver. DbaiGBolee.com